Misuse of B-1 Visas Lands Tech Giant $34 Million Fine with DOJ

Earlier today, the DOJ slapped Infosys with the largest immigration-related penalty in the history of Immigration violations ever, in the amount of $34 million dollars.

Two weeks ago, we wrote on our sister blog about Infosys setting aside approximately $35 million dollars from its reserves in anticipation of the investigation coming to a close and having to pay penalty fees and legal costs.  Today marks the culmination of that investigation, with a record-setting fine for INA violations.  For more details about the I-9 issues, click here.

THE FACTS

According to the press release and the settlement, the DOJ completed its investigations of Infosys, one of the largest providers of global technology, consulting, and outsourcing services in the U.S.

The case began February 2011, as a whistleblower case when an employee raised concerns about the company’s alleged use of B-1 visitor visas for foreign employees to circumvent the H-1B process.  The employee filed a civil lawsuit against the company, which was ultimately dismissed in federal court in August 2012.

However, the whistleblower case was enough to trigger a bigger investigation by DHS and the DOJ into the company’s use of B-1 visas and a Form I-9 audit in May 2011.

According to the DOJ’s press release, Infosys was alleged to have committed the following:

  • Used B-1 visa holders to perform jobs that involved skilled labor that were instead required to be performed by United States citizens or required legitimate H-1B visa holders.
  • Submitted “invitation letters” to U.S. Consular Officials that contained false statements regarding the true purpose of a B-1 visa holder’s travel in order to deceive U.S. Consular Officials and secure entry of the visa holder into the United States.  These letters often stated that the purpose of travel was for “meetings” or “discussions” when the true purpose was to engage in activities not authorized under a B-1 visa.
  • Directed B-1 visa holders to deceive U.S. Consular Officials, including specific instructions to avoid certain terminology, to secure entry of the visa holder into the United States.  Infosys created a “Do’s and Don’ts” memorandum that it provided to foreign nationals entering the United States on a B-1 visa that included the following directions: “Do not mention activities like implementation, design & testing, consulting, etc., which sound like work”; “Also do not use words like, work, activity, etc., in the invitation letter”; and “Please do not mention anything about contract rates.”
  • Told its foreign nationals to inform U.S. Consular Officials that their destination in the United States was the same as that provided in the Labor Condition Application, notwithstanding the fact that Infosys knew that the destinations had changed.
  • Wrote and revised contracts with clients in order to conceal the fact that Infosys was providing B-1 visa holders to perform jobs that involved skilled or unskilled labor that were otherwise required to be performed by United States citizens or required legitimate H-1B visa holders.
  • Concealed the fact that B-1 visa holders were performing jobs that involved skilled or unskilled labor that were otherwise required to be performed by United States citizens or required legitimate H-1B visa holders by billing clients for the use of off-shore resources when, in fact, work was being performed by B-1 visa holders in the United States.

Today’s announcements marks the official end of the investigation but the beginning of what may be a nightmare for not just Infosys, but the global economy.

THE PENALTIES

Part of the settlement agreement requires the company to pay $34 million due to B-1, H-1B and I-9 non-compliance.  Infosys will be required to report its usage of B-1 visas, submit detailed invitation letters (for B-1 visas), and implement and use a disciplinary process for employees who violate INA laws.

WHY THIS MIGHT AFFECT YOUR CLIENTS

Although, on the surface, no official criminal charges were filed against the company, one has to wonder if the Department of Justice ever used the threat of criminal charges as a negotiating tool ….

Aside from the immediate impact on the company, the settlement will have an even greater impact on business immigration practitioners generally and your business clients, for a couple of reasons.

First, legislators who have been critical of the H-1B process for alleged abuse and fraud will now have another visa in which to focus their criticisms.  Although past legislation proposed at restricting or curtailing immigration visas have not been met with much success in Congress, the sentiment that “fraud is rampant” will likely put immigration and consular adjudicators on alert, which will ultimately have a negative impact on the law-abiding business who submit legitimate and needed immigration visa petitions to USCIS and applications to consular offices abroad.

This leads me to my second reason; clients should be forewarned of the proper and improper methods for bringing in foreign workers to the U.S. on a visitor visa.  By and large, my experience drafting visitor visa letters has always been for companies who have been conscientiously playing by the rules.  I suspect a large majority of businesses play by the rules and your clients will be no different.  This case is a good cautionary example to present to business clients who might be tempted to stretch the purpose of the B-1 visa.